Latvia will support Rail Baltica, the high-speed railway project, on the condition that the European Union raises its co-financing contribution from the currently proposed 60 to 85 percent, said Latvian Prime Minister Valdis Dombrovskis.

The task of convincing EU officials is left to European Commissioner for Transport Siim Kallas, who has supported the idea and might be able to reach an agreement, reportedPäevaleht.

As the project is very large and expensive, less financing from the EU would make it unaffordable for Latvia, said Dombrovskis, who plans to meet with Kallas in January to discuss the details.

The rail project that would link Estonia to Poland has been under negotiation since 2004, and will take around 3.7 billion euros to build. Construction is estimated to be completed by 2025.

Chairman of the Social Democratic Party (SDE) and former minister of health and labour, Jevgeni Ossinovski expects poverty in Estonia to decrease as an effect of the current government's income tax reform, though the actual impact will become clear only after data is evaluated next year.